USPS Board of Governors Postpones New Dim Policy Implementation While Releasing FY 2018 Results

By November 17, 2018 Contract Negotiation, Invoice Auditing, News

Background: The announced 2019 USPS rate changes included some dramatic adjustments to USPS Shipping options, including the switch to zone-based pricing for First Class Packages and the structure change relating to dimensional charges.

Currently, large packages are only “Dimmed” when their volume exceeds 1 cubic foot AND they’re destined for outer zones 5-8.  The current Dim factor is 194 (higher dim factors result in lower billed weight).  The Dim Divisor for affected packages was scheduled for a reduction from 194 to 166 for all zones on January 27, 2019. Balloon pricing for zones L-4 was also targeted for elimination.

Postponement:

The USPS Board of Governors met on November 14th and announced that USPS will postpone the implementation of dimensional weight pricing for Priority Mail, Priority Mail Express and non-Lightweight Parcel Select packages until June 23, 2019.

This gives the industry an additional five months to make the operational and software changes necessary to adjust to the new pricing regime.

All other announced price changes for Mailing Services and Shipping Services, including zoned-based pricing for First-Class Package Services (FCPS), will take effect on January 27th as originally announced.

USPS Reports Fiscal Year 2018 (October 1, 2017 – September 30, 2018) Results:

  • Overall revenue increase of $1.0 billion
  • Shipping and package revenue up $2.0 billion, 6.8% increase in volume
  • Overall volume decline of 3.2 billion pieces
  • Net loss of $3.9 billion (due to $6.9 billion in mandated prefunding of healthcare and pension)
  • Includes $1.8 billion in debt reduction
  • Renews urgent need to advance legislative and regulatory reforms, as well as aggressive postal management actions to generate new revenue and control costs

In the meantime, feel free to reach out to me with questions or to ask for help.  Wishing you great shipping success.

Gordon Glazer, CMDSM, CMDSS, MDP, MDC is a Senior Consultant, USPS Specialist at Shipware LLC, an innovative parcel audit and consulting firm that helps volume parcel shippers reduce shipping costs 10%-30%. Gordon is a postal industry veteran with 32 years’ experience and is a sought-after speaker and industry thought leader. He welcomes your questions and comments, and can be reached at 858-724-0457 or gordon@shipware.com.

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